MOODY'S UPGRADES INDUSTRY & CONSTRUCTION BANK'S FOREIGN CURRENCY DEPOSIT RATINGS AS WELL AS THE SENIOR AND SUBORDINATED FOREIGN CURRENCY DEBT RATINGS FOLLOWING THE TRANSFER OF CONTROLLING INTEREST TO RUSSIA'S VNESHTORGBANK

US$ 700 million in outstanding debt securities affected Moody's Investors Service has upgraded the long- and short-term foreign currency bank deposit ratings of Industry & Construction Bank (ICB) from Ba1/NP to Baa2/Prime-2 -- the country ceiling for foreign currency bank deposits. The bank's senior unsecured and subordinated foreign currency debt ratings have also been upgraded to A3 from Ba1 and to Baa1 from Ba2, respectively. The Financial Strength Rating (FSR) remains unchanged at D- (D minus). The outlook for the bank's long-term and short-term deposit ratings as well as for the D- FSR is stable, while the outlook for senior and subordinated debt ratings is positive. At the same time, Moody's Interfax Rating Agency, which is majority-owned by Moody's, has upgraded the long-term national scale credit rating of ICB to Aaa.ru from Aa1.ru. According to Moody's and Moody's Interfax ("Moody's"), the Baa2/Prime-2/D- global scale ratings reflect ICB's global default and loss expectation, while the Aaa.ru national scale rating reflects the standing of the bank's credit quality relative to its domestic peers. Today's rating actions reflect the finalisation of the acquisition of a 75% + 3 shares stake in ICB by Russia's Vneshtorgbank (VTB), rated at Baa2/Prime-2/D- (all ratings with stable outlooks), and the latter's strong propensity and capacity to support ICB in case of need. While both banks are rated at the country ceiling for foreign currency bank deposits (which is below the unpublished global local currency ratings for both banks), some rating differential between the two still remains in the unpublished local currency and published foreign currency debt ratings to reflect ICB's status as VTB's subsidiary. On the other hand, the positive outlook on ICB's senior unsecured and subordinated foreign currency debt ratings is based on Moody's expectation that ICB will be fully absorbed by VTB, ceasing to exist as a separate legal entity, hence resulting in full rating convergence. Industry & Construction Bank is headquartered in St. Petersburg, Russian Federation. It was formerly the largest non-state-owned bank in the Northwest region, and reported total assets of US$3.6 billion under IFRS (audited) as of 31 December 2004. NATIONAL SCALE RATINGS Moody's Interfax Rating Agency's National Scale Ratings (NSRs) are intended as relative measures of creditworthiness among debt issues and issuers within a country, enabling market participants to better differentiate relative risks. NSRs in Russia are designated by the ".ru" suffix. NSRs differ from global scale ratings, as assigned by Moody's Investors Service, in that they are not globally comparable to the full universe of Moody's rated entities, but only to other rated entities within the same country. ABOUT MOODY'S AND MOODY'S INTERFAX Moody's Interfax Rating Agency specialises in credit risk analysis in Russia and is 51% owned and controlled by Moody's Investors Service, a leading provider of credit ratings, research and analysis covering debt instruments and securities in the global capital markets. Moody's Investors Service is a subsidiary of Moody's Corporation (NYSE: MCO), which reported revenues of US$1.4 billion in 2004, employs approximately 2,500 people worldwide and maintains offices in 19 countries. Further information is available at www.moodys.com.

• Status
  redeemed
• Country of risk
  Russia
• Redemption (put/call option)
  *** (***)
• Amount
  400,000,000 USD
• М/S&P/F
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